Need to Explore Innovative Approaches to Sustain High Growth With Stability; Challenge is to Harness this Growth to Make the Development Process More Inclusive, Strengthen Food Security, Improve Education Opportunities and Health Facilities Both in Rural and Urban Areas ; Discussions Underway to Build Consensus on Further Liberalisation of the FDI Policy in Retail and Defence Sector: FM
The Union Finance Minister Shri Pranab Mukherjee said that there is need to explore innovative approaches to sustain high growth with stability. Shri Mukherjee said that the challenge of sustaining high growth has become more complex because of rapid globalisation and the growing influence of global developments, economic as well as non-economic on routine domestic concerns. He said that therefore, the policy makers have to be far more alert and prompt with their response. The Finance Minister Shri Mukherjee was delivering his keynote address at a Conference on US-India Economic and Financial Partnership in Washington DC yesterday. He was sharing the dais with Mr Timothy Geithner, Secretary, US Department of Treasury. The daylong conference was being organised by Confederation of Indian Industry (CII) in collaboration with Brookings Institute of US.
The Union Finance Minister Shri Pranab Mukherjee said that India’s economic reforms have contributed to the Indian growth story. He said that this year, we commemorate two decades of the initiation of reforms. In this period, the Finance Minister said that the economy has rapidly globalised and from around 2003-04, it has moved on to a higher growth path. Shri Mukherjee said that between 2004-05 and 2006-07, the economy grew at 9.5 per cent which helped in raising the trend GDP growth rate to 8.5 to 9 per cent per annum. He said that though the global financial crisis of 2008 lowered the GDP growth rate in India to 6.8 per cent in 2008-09 yet the Indian economy rallied back with an 8 per cent growth in 2009-10.
The Union Finance Minister Shri Pranab Mukherjee said that the experience in the post-2004 period shows that Indian economy has become remarkably resilient to both external and domestic shocks. It managed to moderate the decline in GDP growth during the global economic downturn and recovered rapidly in 2009-10, the Minister added. He said that it also took the monsoon failures in the preceding two years in its stride and is now showing robust growth with agriculture production set to record a new high in 2010-11. The Finance Minister Shri Mukherjee said that overall GDP growth in 2010-11 with a broad based performance covering all the three sectors of the economy has been estimated at 8.5 per cent. The economy is expected to maintain the momentum at the same level in 2011-12, the Minister added.
The Union Finance Minister Shri Pranab Mukherjee said that there are several reasons that Indian growth is almost universally predicted to be sustained at a high rate of 8 to 9 per cent per annum over the next few decades by economic analysts. Enumerating the reasons for the same, the Finance Minister Shri Mukherjee said that First, the savings and investment ratios in the country have gone up in the last few years and are reminiscent of the high growth in East Asian economies. Secondly, India’s working age population is young with over half the population is in the twenties. Thirdly, growing middle class incomes have led to self sustaining buoyancy in domestic demand, particularly in the rural areas. Fourthly, India is making rapid progress in infrastructure, both social and physical and along with better access to cutting edge technology is likely to see improvement in productivity, the Minister added.
The Union Finance Minister Shri Pranab Mukherjee said although these are the primary factors for India’s dynamic growth yet there are many other drivers of the Indian growth story including the energy and...
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